According to Babatunde Fashola, who is was the former minister of works, Nigerian employees should be allowed to make fair adjustments to deal with the country’s high cost of living.
Fashola wrote this in an article titled “Minimum Wage Review – My Take Away.”
“The lowest and the highest income earners are impacted to varying degrees when cost of living rises as they have now, and therefore deserving of reasonable adjustments whether they earn wages or salaries,” he stated.
Section 4(1)(b) of the National Minimum Wage Act 2019, which excluded “an establishment employing less than 25 persons” from the Act’s requirements to pay the minimum wage, was heavily criticized by the former governor of Lagos State.
In the former minister’s opinion,the exemption of these establishments, “raises serious doubts about whether we have enacted a minimum wage Act if small businesses that employ the majority of the most vulnerable people but barely have 25 employees are exempt from the law as currently legislated So, who is being protected by the law?
According to Fashola, who is a Senior Advocate of Nigeria (SAN), the National Assembly has the power to establish a national minimum wage for the Federation, not a monthly salary, under item 34 of the 1999 Constitution as it has been revised in the Exclusive Legislative list.
A monthly pay. He stated that though wages and salaries are wide known means of remuneration available to employers, the former is a predetermined annual sum, payable weekly, bi-weekly, or monthly subject to agreement, while the latter refers to payment based on an hourly rate and the number of hours the employee works.
“As a result of this definition, it appears that by putting in place Section 3(1) of the Minimum Wage Act, which states that the minimum wage of N30,000 should be paid monthly, the NASS may have acted unconstitutionally by legislating on a SALARY (monthly payment) when they only have the power to legislate on WAGES (hourly payments).
“Of course, if and when we decide as a country on the implementation of a proper minimum wage, we must then design a formula to review salaries of those who do not earn wages in order to assist them deal with cost of living challenges.
“This is important while the conversation on minimum wage is being had in 2024 because in Section 3(4), the minimum wage “shall be reviewed in line with the provisions of this Act” which includes Section 3(1) that has prescribed a monthly amount instead of an hourly wage.
“Of course, if and when we decide as a country on the implementation of a proper minimum wage, we must then design a formula to review salaries of those who do not earn wages in order to assist them deal with cost-of-living challenges.
“This may yet be the most fruitful outcome of the dilemma of appropriate employee compensation as it may lay the foundation for national productivity, wealth creation and prosperity. The opportunity is too big to miss or waste,” Fashola’s article read.
Labour unions opines that the current minimum wage of ₦30,000 is not sufficient for the well-being of Nigerian workers due to the hike in prices of everything, and the administration’s policies of removing petrol subsidies and unifying the forex windows.
The labour unions also expressed their concern that some governors in the country are not paying the current wage award, which would expire in April 2024, five years after former President Muhammadu Buhari signed the Minimum Wage Act of 2019. The Act should be revised after every five years to make sure that it aligns with the current economic demands of workers.
In January 2024, President Bola Tinubu created a tripartite committee to make negotiations on the country’s newly proposed minimum wage.
During discussions, Labour proposed a minimum wage of ₦615,000, which they later reduced it to ₦497,000 and finally ₦494,000.
At the initial stage of negotiations, the government and the Organized Private Sector proposed ₦48,000, ₦54,000, ₦57,000, and later ₦60,000. However, Labour rejected all four offers,which resulted to the warning strike.
On Monday, June 3, 2024, the Secretary to the Government of the Federation (SGF), George Akume, said that the President was committed to a wage above ₦60,000 and that the government side of the tripartite committee would meet with labor for one week to come to an agreement
The organized labour “relaxed” the strike it started on Tuesday, June 4, 2024, approximately 24 hours after strike.
The leadership of the Trade Union Congress (TUC) and the Nigeria Labour Congress (NLC) have since then begun talks with members from the Federal Government, states, and the Organized sector.
The President also charged Wale Edun, Minister of Finance, to create a framework for a new minimum wage. Prior to the directive, the minister termed the workers demands as “unaffordable.”
The governors of the 36 Nigerian states pointed out that labor’s demands were unsustainable. Local government administrations also regarded the NLC and TUC’s minimum wage proposals as unreasonable.
However, on Friday, June 7, 2024, the two sides (labor and government) were unable to come to a deal. The labor demand that the proposed money be reduced from ₦494,000 to ₦250,000, while the government increased the initial ₦60,000 offer by ₦2,000 which made it ₦62,000.
Both parties filed reports to the President, who is expected to make a send an official executive bill to the National Assembly to enact a new minimum wage bill, which the President will sign into law.
In his Democracy Day speech on June 12, 2024, the President told the Organized Labour that an official law establishing a new national minimum wage for workers will be brought to the National Assembly from his office, he further went on to tell them that the presidency will only pay what they can afford.
